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March 8, 2013 (Washington, D.C.) -- Diabetes cost the United States an estimated $245 billion in 2012, according to a new analysis from the American Diabetes Association (ADA).

The report is an update to the ADA’s last cost report issued in 2007. It looks at the use of health resources and lost productivity due to diabetes, as well as costs incurred by people with diabetes in the U.S.

The findings, to be published in the April 2013 issue of Diabetes Care, were released at a press briefing on Capitol Hill.

According to the report, about 22.3 million people -- 7% of the U.S. population -- were living with diabetes in 2012, an increase of nearly 5 million since 2007.

“We have an incredible epidemic of diabetes that is driving health care expenditures excessively. ... Unless we do something to stop diabetes, the economic cost will continue to rise,” ADA Chief Scientific and Medical Officer Robert E. Ratner, MD, said at the briefing.

The Rising Cost of Diabetes

The $245 billion figure is made up of $176 billion in direct medical costs, including hospital and emergency care, doctors' visits, and medications. There also are $69 billion in indirect costs, including lower productivity at work or lost productivity, and premature death.

The total represents a 41% increase from the ADA’s last estimate of $174 billion in 2007, Ratner said.

According to the report, after taking into account age and sex, annual health expenses for people with diabetes are more than double than for those without -- $13,741 vs. $5,853. This suggests that diabetes is responsible for $7,888 in excess costs per year.

According to Ratner, the increased number of people with diabetes is the main reason for the greater economic burden, rather than a rise in medical costs per person.

The cost of diabetes patients spending time in the hospital was the largest contributor to direct medical costs in 2012, at $76 billion compared with $58 billion in 2007. However, on a good note, Ratner said inpatient costs as a proportion of total direct medical costs dropped from 50% to just 43% of the total.

“We appear to be avoiding the costs of hospitalizations and improving less expensive outpatient management,” he said.

Sen. Susan Collins (R-Maine), co-chair of the Senate Diabetes Caucus, also spoke at the briefing, noting that one-third of Americans over 65 have been diagnosed with type 2 diabetes, and half are at risk for it.

And, she said, about 1 in 3 Medicare dollars is spent on diabetes. “When you look at the impact of diabetes, it’s evident that if we could prevent the disease and come up with better treatments, we could have a major impact not only on peoples’ lives, but also on the Medicare and Medicaid budgets.”

To see a version of this story for physicians, visit Medscape, the leading site for physicians and health care professionals.